Federal Housing Funds Being Spent Miamidade Eyes Next Round Of Allocations
Written by Yudislaidy Fernandez on September 10, 2009
By Yudislaidy Fernandez
County neighborhoods are getting cleaner, families are buying homes and more affordable housing options are coming on line as localities begin to spend federal funds allocated for foreclosure relief — and we’re in line for added cash to do more.
In the first funding round, Miami-Dade got $62 million under the Neighborhood Stabilization Program — more than any other locality in the US as part of the Housing and Economic Recovery Act of 2008 — and the City of Miami, heavily affected by foreclosures and distressed properties, got $12 million.
More could be on the way. Miami-Dade is in line for the second round of foreclosure relief funding, vying for $162 million more.
This time, the $1.93 billion in federal funding is up for grabs through competitive applications. Results are expected in December.
For now, Miami-Dade has closed on its first home in West Dade and has five more contracts ready to go to closing, said Clarence Brown, chief operating officer and director of the housing assets management section of the Community and Economic Development office.
The spending is part of the $9.8 million share of allotted funds geared towards providing homeowners soft mortgage assistance and closing costs.
Mr. Brown says the county continues to search for home acquisitions.
Under the foreclosure relief program, Miami-Dade is to devote about $21.6 million to acquire and rehabilitate foreclosed-upon multi-family properties to use as affordable rental housing and $10 million to acquire and rehabilitate foreclosed-upon single-family homes to resell.
Mr. Brown said the county is to select developers to acquire and rehabilitate single- and multi-family homes to offer residents more affordable housing options. But he said he couldn’t discuss details because the contracts are currently subject to the county’s "cone of silence" period.
Another $5 million is set aside to build a multi-family complex in partnership with a developer.
About $1 million is earmarked to demolish blighted eyesores. So far, Mr. Brown said, the county has made deals with Florida City, Opa-locka and South Miami to demolish properties.
The county is investing $8.6 million to build a multi-family development under the federally-administered Hope VI, a program seeking to transform public housing.
The county is teaming up with St. Louis-based McCormack Baron Salazar to build the housing, Mr. Brown said, adding that the firm was selected because of its experience with Hope VI. He said he expects to execute that agreement soon.
The remaining $6.2 million pays administration and planning expenses.
The federal program required allocating the first cycle of funds in moderate- to low-income areas with high foreclosure rates.
To identify Miami-Dade’s "areas of greatest need," county planning and economic experts used a formula of the number of foreclosures, number of subprime loans and number of residents at or below 120% of the area median income.
The Department of Housing and Urban Development is closely watching Miami-Dade’s spending because of the county’s track record of misspending and poor results.
The county had to submit an action plan to resolve outstanding deficiencies and explain why past issues won’t affect the program’s administration.
Through the hands of selected developers, Miami is spending a portion of its federal funds earmarked to purchase and re-sell homes to qualifying buyers.
So far, $250,000 checks went to two selected local developers: Prodesa Development LLC and Habitat for Humanity of Greater Miami. Each is to use the money to buy, repair and resell single-family homes.
"The money we provide to the developer comes back to us, but we might have to assist the buyer to purchase the property," said George Mensah, Miami’s director of community development. Those returned funds are used to buy more homes, he added.
Mr. Mensah says the city is to partner with other developers to spend about $4.5 million awarded for rental multi-family developments.
The bidding has closed and developer applications are under review. Those that qualify must control the property because the city’s funding is to be spent in rehabbing the building for rent. Results are expected in October.
Today (9/10), the Miami City Commission is to review the 23 homes identified as unsafe, which are to qualify for demolition using the $700,000 the city got for this task, Mr. Mensah said.
And another $706,000 is to go toward building new homes on those empty sites.
The city is also negotiating to buy the 51-unit Cedars Point building at 1531 NW 16th Ave. to offer it for low-income rental. Plans are to hand the building to a non-profit to manage with a covenant to prevent the group from selling it or changing uses, Mr. Mensah said.
To help in the purchase of homes, $2.1 million is slated to subsidize qualifying residents to buy foreclosed homes in neighborhoods identified as "areas of greatest need" such as Little Havana, Liberty City and Overtown.
Miami is working with the Realtor Association of Greater Miami and the Beaches and local lenders to kick off the program Oct. 1.
Another $1.2 million is set aside for administration costs.
Local governments have 18 months from March 2009 to commit the federal funds for foreclosure relief and have four years to spend the cash. Advertisement